Clause 34 - Location of assets etc
Finance Bill
11:45 am
Mark Field (Shadow Minister, Treasury; Cities of London and Westminster, Conservative)
I accept that the measure is a sensible decision. However—I do not expect the Minister to go into any great detail on this—I hope that the Treasury is entirely aware of the situation in what is clearly and inevitably a fast-moving world. In particular, a large number of transactions take place over the internet and it is sometimes difficult to gauge the companies involved in such transactions and the legal rights of customers and companies.
It strikes me that we are talking about an area in which a great deal of detailed academic thinking will have to come into play, probably in the very near future but certainly within the next decade or two, if we are to ensure that there is a proper tax regime and that sufficient proceeds are coming through to the Treasury. My question is not what specifically is being done, but whether, in a more general sense, thought is going into the increasing amount of trade taking place over the internet. That might have an impact on a range of taxes—initially, obviously, sales tax, but potentially capital gains tax, too.
I represent the west end of London, where a number of our retailers have some woeful stories. I suspect that the problem is not only the congestion charge, but the fact that, increasingly, a great amount of their money is taken away because of the number of transactions and sales that take place over the internet. Is there some blue skies long-term thinking going on in the Treasury about the future nature of taxation and the taxation burden, especially for capital gains tax? We live in a world where the obvious boundaries of nation states are becoming far more blurred as far as such transactions are concerned, and I hope that something new is being done. I guess that any new measure will be supranational, involving the EU countries and, increasingly, the United States—which, as ever, is likely to be one step ahead of the game—to make sure that we close any loopholes before they become apparent to highly paid tax advisers.